China's steel exports will remain competitive and are unlikely to fall much this year, as low prices and firm demand offset the scrapping of an export tax rebate on certain products, the China Iron & Steel Association (CISA) said. Beijing wants to rein in exports to avoid increasing trade friction and, by cutting output, to reduce pollution, but a collapse in iron ore prices has helped Chinese steelmakers maintain the supply of cheap products for overseas markets. The government has removed a tax rebate for boron-added steel, originally introduced to encourage value-added products since the element gives a harder steel. Exporters had profited by claiming a rebate after adding minute amounts of the element. The removal has had some effect, and growing anti-dumping measures would also slow down growth in steel exports, the CISA said in a quarterly press release published on its website. "But there is still demand in international markets and there is a price gap between steel at home and abroad. Chinese steel exports are still competitive and will not drop by a large amount," the CISA said. Steel mills are looking to win a fresh export rebate by adding chrome to give their products more value and are targeting regions such as Southeast Asia and South America. Chrome is slightly more expensive than boron. China boosted steel exports by around 50 percent last year to a record 94 million tonnes and Western industry bodies see little sign of a major rationalization of the industry. Exports of steel products rose 41 percent in the first quarter from a year before to 25.78 million tonnes. [MTL/CHINA3] Lukewarm steel demand at home and tumbling prices caused combined losses of 11.1 billion yuan ($1.79 billion) for the core businesses of large and medium-sized steel mills in the first quarter, up 3.4 billion yuan from a year before, the CISA said. Maanshan Iron lost 595 million yuan and Valin Steel expected a loss of 160-180 million, both citing a drop in prices in their exchange filings. Rebar prices on the Shanghai Futures Exchange tumbled 9.5 percent between January and March as demand in the world's top producer and consumer was hit by stagnant economic growth and a property market downturn. Sales revenue dropped by 685.31 yuan per tonne in the first quarter, while sales costs fell only 672.56 yuan. Meanwhile, environmental costs and labor costs keep rising, the CISA said. China's apparent consumption of crude steel shrank 6.2 percent to 177 million tons in the first quarter against a fall of 4 percent in the whole of 2014. (Reuters)